House building lifts October construction output, ONS says

Construction activity accounts for about 6.3% of the UK economy

Output in the UK construction industry rose by 2.2% in October, fuelled by a big increase in house building, according to the Office for National Statistics (ONS).

New housing rose 5.8% from the previous month, while repairs were also up, but other types of new work declined.

The figures mark a sharp improvement from September, when construction output shrank by 0.5%.

The latest figure means that output is up 5.3% on the year.

The ONS said increased demand for housing could be spurring construction in the housing sector.

"The introduction of help-to-buy schemes has buoyed the housing market and may be contributing to relatively strong growth in house prices, which grew by 3.8% in the year to September 2013," it added.

However, construction growth in the industrial sector was still "weak and negative".

Howard Archer of IHS Global Insight said: "Evidence that the construction sector is gaining momentum is obviously good news for fourth-quarter GDP growth prospects, although it needs to be remembered that the sector only accounts for 6.3% of national output.

"Even so, the relatively small size of the construction sector did not prevent it being an appreciable drag on GDP growth in 2012, so it is clearly good news for the economy to see such a marked turnaround in its performance."